In our cells we have devices called mitochondria.  These are thought to have once been independent bacteria that merged with other bacteria to form the kind of cells that make us today.  Supporting this theory is the fact that mitochondria have their own DNA, separate from the cell's nuclear DNA.

The mitochondria have the important ability of utilising oxygen to generate ATP. The use of oxygen (aerobic respiration) in creating ATP is much more efficient than without (anaerobic respiration). The mitochondrial system (mitochondrial respiration) can utilise several primary energy rich substrates to generate ATP (pyruvate, fatty acids, carbon skeletons from amino acids, and ketone bodies) and also secondary substrates required by internal reactions such as protons and Pi.  As such the mitochondria have an all round ability to utilise all energy sources and waste products (from other reactions) in the regeneration of ATP.

Whilst mitochondrial ATP production can meet the needs of the cell, waste production will be kept to a minimum and energy production will not be a limiting factor in exercise.  However, the power (energy per second) of mitochondria can easily be exceeded with moderately high exercise (and above).  Limiting factors include the number of mitochondria within the muscle cells, the amount of oxygen that can be delivered to the cells via the lungs and blood, and the supply of energy substrate.  The lack of energy substrate becomes a concern when pyruvate (via glucose) becomes scarce as lipid (fats) supply can be slow.

The waste product of oxidative phosphorylation is carbon dioxide (CO₂) which exits the cell into the blood and is transferred to the lungs where it is exhaled.